GDP size and inclusive growth

Context: 

The article analyzes the size of the Indian economy in context of distribution of economic growth.

India’s GDP growth:

•  Recently, India has overtaken the United Kingdom to become the world’s fifth largest economy.

• The London Based consultancy Centre for Economics and Business Research (CEBR) predicted that by 2035, India’s economy would reach $10 trillion and become the world’s third largest by 2037.

Why is the West attracted towards India’s growth?

• As India is not only a relatively rare democracy in the east but also the largest one in terms of population, Western countries see a possible alliance of interests.

• India is not only a market for goods , its fast growth is an investment opportunity for the surplus savings of the West also. As a fast growing economy, investing money in India is likely to fetch the highest returns globally.

Disparity of economic growth and it’s distribution:

• Centre For Monitoring Indian Economy Pvt. Ltd. shows that the number of people employed in December 2022 was less than it was in 2016. Clearly, the growth of the national economy has not generated an equal growth in employment.

• For the mass of the unemployed, concentrated in agriculture, growth of the IT sector or of exportable manufactures has not been of much use as this is a cohort with low education and skills.

• Currently, we do not have an employment policy, either at the Centre or in the States. Welfarism, defined by the free or subsidized distribution of private goods, is no substitute.

• Plans for infrastructure aimed at religious tourism are implemented in States that have only recently witnessed landslides and flooding.

•  Growth is pursued with a view to enhancing the electoral prospects, without concern for a possible negative fallout.

Conclusion:

• Economic growth should lead to employment opportunities for a growing population of youth and generate the social and physical infrastructure necessary for a good life. 
• It should not magnify the rising economic inequality and ecological insecurity. 
• A creative economic management of the growth process would be necessary to bring about the positive ones and to avert those that are negative.

News Source: The Hindu

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